2. Estudio de Caso Vereda Chipautá
2.4 Resultados
Global Markets and Risk – It did not take long for the pundits, commentators, economists and business TV gurus to turn their minds from Brexit to the next biggest threat to global financial market stability – Donald Trump. It is not an unreasonable shift in focus given that the outcome of the US presidential election in November will have a significant impact on currencies, bond markets, equity market valuations and other asset prices. But the possibility of a Trump victory may well be felt well before then thanks to the shock Brexit outcome. "One should not underestimate the psychological impact and how quickly markets could link the [Brexit] outcome to a rising risk of Donald Trump winning the US presidential election," Nomura's chief economist and head of global markets research, Robert Subbaraman, told clients at the weekend. He says two lessons were learned from the Brexit referendum. First, opinion polls showing a neck-and-neck race between Trump and Hillary Clinton need to be taken seriously. Second, financial markets can wildly misprice the outcome of a democratic vote. "The upshot is that investors are likely to take the results of opinion polls more seriously now and, as such, financial markets could start pricing in a greater risk of a Trump victory in the November 8 election and, possibly, a greater chance of populist insurgencies in the rest of Europe," Subbaraman said. Gold has been the big winner from the Brexit vote. Bullion has surged in value, as have the shares in gold mining stocks. There are two reasons for this: gold is a safe haven during times of market volatility, and there is an expectation that central banks will be in the market for a range of assets as they flood the world with liquidity during the next bout of uncertainty. AFR
Markets and Central Banks – Investors are back in risk-taking mode, amid growing confidence that the world's major central banks will unleash a fresh flood of liquidity to counteract the negative economic shock from the Brexit vote, which could sweep global equity markets to fresh highs. The magnitude of the monetary stimulus that could be unleashed is even worrying some central bankers. Overnight, Mario Draghi, the head of the European Central Bank (ECB), pleaded for central banks to be cautious and avoid triggering a major global currency war. Major central banks – including the ECB and the Bank of Japan – have launched massive bond-buying programs and slashed their key deposit rates into negative territory – in a bid to boost economic activity and spur inflation. But the main impact of these policies has been to push their currencies lower, which has helped boost export sales. But Draghi, who would not have been unhappy to see the euro tumble in the wake of the UK's decision to leave the European Union, is clearly worried about the likely Japanese response to surging yen. Addressing an ECB conference in Portugal on Tuesday night, Draghi emphasised it was important that the world's top central banks co-ordinate their policies, and warned that currency devaluations aimed at increasing competitiveness are a "lose-lose" for the global economy. "In a globalised world, the global policy mix matters – and will likely matter more as our economies become more
integrated", Draghi said. "The speed with which monetary policy can achieve domestic goals inevitably becomes more dependent on others." It's likely that Draghi's concern about the global impacts of monetary policy have been
heightened by growing speculation that Tokyo is preparing to intervene directly in foreign currency markets to combat the yen's strength. AFR
Frexit (US Fed exiting rate rise cycle) – Circle January 31, 2018, on the calendar. That's the soonest the Federal Reserve hikes next. At least if money market derivatives are to be believed. Traders, who have consistently been better at projecting the path of interest rates than the Fed itself, are now pricing in a greater probability that policy makers will cut rates in upcoming meetings than raise them. They don't assign more than a 50 per cent chance of an increase until the beginning of 2018, and don't price in a full rate hike until the final quarter of the year. The sea change in outlook for central bank policy comes after global equities and commodities plunged while government bonds and the US dollar surged following Britain's vote to quit the European Union. That's tightened financial conditions in the world's largest economy, driven down inflation expectations and dimmed the outlook for global growth. "The market is pricing in a non-trivial probability of a Fed rate cut over the next couple of months," said Aaron
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Kohli, a fixed-income strategist in New York at BMO Capital Markets, one of 23 primary dealers that trade with the central bank. "The Fed is really boxed in now, so the market doesn't even begin to price in any real chance of hikes until mid-2017." The market's view on the path of Fed policy is hardly set in stone. Rate hike expectations were upended in August and February amid similar bouts of market volatility. Yet implied yields on federal funds futures, which settle upon expiration at the average effective fed-funds rate during the contract month, are now pricing in a real possibility of a rate cut by year end. The effective rate was 0.41 per cent Monday, and is foreseen by traders averaging 0.35 per cent in December. Options on eurodollar futures, the world's most actively traded money-market derivative, imply a 25 per cent chance of a rate cut by September. That's a reversal from just two months ago, when prices signalled that a rate increase by year end was a virtual certainty. AFREU and Brexit – Despite Brexit, insisted European Commission President Jean-Claude Juncker stoutly, "the British remain our friends". To judge by the extraordinary scenes at the European Parliament, I'm not sure that all his colleagues agree with him. In fact, I'm not sure that Mr Juncker agrees with himself. MEPs were holding an
emergency meeting in Brussels to debate what to do with Britain now. "Democracy is democracy," sighed Mr Juncker, the President of the European Commission. "And we must respect the way the UK has voiced its view." Sitting across the chamber, Nigel Farage applauded. Mr Juncker eyed him grimly. "That's the last time you're applauding here!" he snapped – in English, rather than his usual French. MEPs clapped furiously. Mr Juncker continued to glare at the UKIP leader. "The British people voted for the exit!" he snorted. "Why are you even here?" The President tore himself temporarily away from his foe, and attempted to reassure the chamber. "The British vote has cut off one of our wings – but we're still flying!" he cried, sounding like the knight who gets all his limbs hacked off in Monty Python and the Holy Grail. (" 'Tis but a scratch! Just a flesh wound!"). Guy Verhofstadt, the former prime minister of Belgium, was angry with the UKIP leader too. "It was an absolutely negative campaign – the posters by Mr Farage were like Nazi propaganda," he gasped, his long, lank fringe flapping angrily. AFR
EU and Australia – The European Union is manoeuvring to use Britain's planned exit from the bloc to strengthen trade and political ties directly with Australia. The EU's ambassador to Australia, Sem Fabrizi, said in an interview the grouping was committed to pushing ahead vigorously with political and trade agreements with Australia. Mr Fabrizi noted that Europe – without Britain – would remain the world's largest trading bloc, bigger than the US. Also in the works is the convening of a Europe-Australia Leadership Forum – modelled on the US-Australia Leadership Dialogue – to help expand Australia-Euro relations across the board. Mr Fabrizi anticipates an "intensified debate" following Britain's exit from Europe in which Australian and EU officials step up their engagement on a whole suite of issues, including commerce, climate change, trade liberalisation, security and counter terrorism. A wide-ranging political agreement between Australia and the EU was close to being signed, and negotiations on a trade agreement would begin in the new year. "Life will go on," Mr Fabrizi said. AFR
US Election and Trans-Pacific Partnership – Donald Trump vowed to rip up international trade deals and start an unrelenting offensive against Chinese economic practices, framing his contest with Hillary Clinton as a choice between hard-edge nationalism and the policies of "a leadership class that worships globalism". Speaking in western Pennsylvania, Mr Trump sought to turn the page on weeks of campaign turmoil by returning to a core set of economic grievances that have animated his candidacy from the start. He threatened to withdraw from the North American Free Trade Agreement and pledged to label China a currency manipulator and impose punitive tariffs on Chinese goods. He attacked Ms Clinton on her past support for the Trans-Pacific Partnership, a trade pact negotiated by the Obama government, and challenged her to pledge she would void the agreement in its entirety. Noting Ms Clinton had backed free-trade agreements such as NAFTA in the past, Mr Trump warned: "She will betray you again." At a rally later in the day in eastern Ohio, Mr Trump attacked the Trans-Pacific Partnership in more provocative terms, saying it was a "rape of our country". As a policy manifesto, Mr Trump's Pennsylvania speech was an attack on the economic orthodoxy that has dominated the Republican Party since World War II. It is an article of faith among establishment Republicans and allied groups such as the US Chamber of Commerce, which represents the interests of large corporations, that trade is good and more trade is better. AFR
Australia and Government Spending – Labor is unashamedly defending its plans to permanently expand the size of government with a 10-year budget plan that embeds a record tax take to fund a surge in spending that began during the boom years. However, analysis by The Australian Financial Review of the tax and spending projections of both sides of politics indicates the Coalition is almost certain to match Labor's spending levels unless it ramps up cuts or succumbs to the draw of higher taxes. Failure to trigger either of those options would give a Coalition government little hope of meeting its promise of meaningfully reducing debt and deficits, the analysis shows. Economist Saul Eslake, who confirmed the Financial Review's calculations as credible, said voters were being offered the starkest choice about the size of government since 1993, even though in real terms the differences are modest. While he said there was no statistically significant global evidence to support the idea that the magnitude of government has any bearing on economic growth, it was still clear that neither side has been "wholeheartedly" honest about the affordability of spending hikes and tax cuts delivered during the Howard and Rudd/Gillard years. "Those three governments turned temporary revenue windfalls into permanent, elevated spending commitments," Mr Eslake said. "We have to be prepared to pay for it. Labor has been more honest about that, but perhaps not honest enough." In analysis that underscores how permanent the expansion in government spending as proportion of GDP is likely to become, the 2016 budget papers and Labor's 10-year fiscal plan released on Sunday confirm there is almost no difference between the two sides on spending, which will remain at levels normally associated with recession or economic downturns. AFR
Australia and New Home Sales – New home sales fell for a second month in May as sales of detached houses declined across the eastern seaboard, particularly in the previously buoyant market of NSW. The 6.7 per cent decline in sales of detached homes followed April's 3 per cent fall, and pulled overall private new home sales down 4.4 per cent, the Housing Industry Association said on Wednesday. A rise in so-called multi-unit sales, which can be volatile
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from month to month and rose 4.9 per cent in May after a 10.7 per cent fall in April, was insufficient to offset the monthly fall. At a time when house price growth is moderating and banks are reining in credit to buyers and developers, the pace of the long-awaited cyclical slowdown in housing construction is unclear. While only showing one month's figures, the latest report shows there are risks of a sharp decline. "The latest weakness in new home sales resonates with all the other data on the housing sector - in particular the data on home loans, which has been decidedly more mixed in the past few months," said CommSec economist Savanth Sebastian. "It is clear that housing activity is consolidating with potential home buyers being more circumspect on purchases – a result which isencouraging, as it should ensure a much more sustainable housing market." Mr Sebastian said the figures, collected from a sample of Australia's 100 largest home builders and covering about 14 per cent of the home building industry, would not have fully factored in May's surprise rate cut, which was likely to boost demand for property. The lobby group for volume home builders stressed that the fall, driven by an 11.5 per cent decline in NSW sales, was part of a cyclical downturn. "There is nothing alarming to a reversal in the trend for new home sales," HIA chief economist Harley Dale said. "There is a cyclical downturn ahead for new residential construction activity, as new home sales signal, but the early pullback will be mild by historical standards." AFR
SOURCE – AUSTRALIAN FINANCIAL REVIEW (www.afr.com), THE AUSTRALIAN (www.theaustralian.com.au), THE SYDNEY MORNING HERALD (www.smh.com.au) , BLOOMBERG (http://www.bloomberg.com)
BAILLIEU HOLST
Baillieu Holst Ltd ABN 74 006 519 393 www.baillieuholst.com.au
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